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Miners lead ASX to seven-week high

Australian shares rose 0.9 per cent on Friday to reach a seven-week closing high, with top miners supported by rebounding iron ore prices and the broader market up ahead of China's industrial production data over the weekend.

China's new leaders were likely to stick with the 2012 growth target of 7.5 per cent when charting a course for next year.

"One of the reasons for the gains is better news we've seen from China and expectations the economy there has stabilised and growth has improved modestly," said Michael McCarthy, chief market strategist at CMC Markets.

The benchmark S&P/ASX 200 index gained 42.5 points to 4,551.8, according to the latest data. It slipped 0.3 per cent on Thursday.

"That reflects very positive sentiments and confidence,"said Michael Heffernan, an economist at Lonsec. "Europe is becoming a less and less worrisome issue, and the American issue looks like it's going to be sorted out one way or another."

Investors are also becoming more confident now that a series of Australian economic data this week is out of the way, said McCarthy.

"I wonder with a number of national data hurdles cleared, if those investors who've been buying dividend returns are back in the market today," he said.

Australia's gross domestic product rose 0.5 per cent in the third quarter, roughly in line with forecasts though the smallest rise since early 2011, while employment data beat expectations for a second month in November, with the jobless rate surprising everyone with a drop to 5.2 per cent.

Meanwhile, the Australian market took a positive lead from Europe, said Chris Weston, an institutional dealer at IG Markets, after the European Central Bank (ECB) discussed negative deposit rates at its meeting on Thursday.

"The big move overnight was that the ECB is considering negative deposit rates, which could be really quite good for other assets as well," Weston said.

The major banks all advanced, led by a 1.1 per cent rise in Westpac. The nation's biggest lender, Commonwealth Bank of Australia, rose almost 0.9 per cent.

Retailers rose ahead of the Christmas season, led by department store David Jones, which climbed 2.0 per cent. Wesfarmers, owner of supermarket chain Coles, ended 1.0 per cent higher.

But Myer Holdings backed off from earlier gains and lost 0.5 per cent, after saying at its annual general meeting that a challenging retail and economic environment is continuing both in Australia and internationally.